For Want of a Nail…

It isn’t always the “Big Ideas” that are the most satisfying, but the simple ideas with the big impact.

Idea Aikido so to speak.

One of my favorite examples was with a startup company in Barcelona Spain.

For Want of a Nail

For want of a nail the shoe was lost.

For want of a shoe the horse was lost.

For want of a horse the rider was lost.

For want of a rider the message was lost.

For want of a message the battle was lost.

For want of a battle the kingdom was lost.

And all for the want of a horseshoe nail.

– anonymous proverb

A friend of mine was involved with his first start-up experience, a new telecommunications company. The company was in its very early stages and just beginning to generate some revenue. The business plan was more or less going according to plan, but as with any new venture, cash out was greater that revenues. My buddy was very anxious to begin that next round of financing. He had a fantastic business sense, but very little operational experience. I was brought in as an interim operations director.

Got no time

His problem, as he described it to me, was that he just didn’t have the time. He was completely engulfed with strategic financial issues and he had no opportunity to seek new, potential investors and begin to build those important relationships. He was busy on a daily basis working the finances of the company and developing different scenarios. His first thought was to hire an outside financial consultant to assist him in planning for the next level of financing. That would have been a very costly expense for a fledgling company.

The woman hired for bookkeeping/administration tasks was always hopping to support the CFO, manage the bookkeeping software, and answering the incoming calls.

So, what was really the problem?

It seemed that everyone was competent, if not expert in their fields. It seemed as if everyone was just overwhelmed by the minutia of the daily operations.

There is a great book called “Life 101: Everything We Wish We Had Learned about Life in School–But Didn’t” by Peter McWilliams. One of the book’s concepts that has always stuck with me is how he conceptualizes money.

McWilliams describes money as a form of energy. The energy can be stored by using money as a battery that you can save and later expend. The energy stored can be released in the form of materials or time. Materials is obvious, but the idea of buying time was an interesting twist. The purchase of time is can be described as the cost of a service or skill and also the time it took for someone to master that expertise.

It is not always the direct purchase of the time that really creates the value. In the case of my example, it really wasn’t high cost expertise that was needed. What was needed was not time to accomplish a specific task, but offset time: time to concentrate, time to plan, time to execute.

Creating time

My solution was that we hire a telephone receptionist. At that time, Barcelona (and the rest of Catalunya) was just taking off as one of the major economic hubs of Spain. We were able to hire a telephone receptionist at a fair wage for an annual cost of about 2,300,000 Spanish pesetas (or about $15,000).

The value of the small cost and its impact was pretty immediate:

The telephone receptionist took over all the incoming calls, mail distribution, greeting visitors, and all those other daily admin tasks that can grind away at your time.

The bookkeeping/administrator (who was previously performing the above tasks) was able to focus completely all of the complicated housekeeping chores that support the important minutia of managing the company’s cash flow.

The CFO was able to focus on the strategic financial planning of the company and developing the financial relationships with banks and other financial partners.

Conclusion

It is not popular these days to have assistants for everyone. But, there are those instances when a small purchase of time can free up what would otherwise be more expensive time. In this case, the low level time investment, rippled upward and increased in value at each level.

And my friend? Because he was able to find that nail, he secured $10 million in additional financing with an American partner within a year.

One of the key issues in organizational development is planning for change. Change can include a functional reorganization or growth. Both the art and the science is to keep a stable continuity base while implementing the change. In this case, it was to hire an admin person to give the senior executives the time to plan and execute their strategy responsibilities.